Hydro-Québec plans to ask Quebec’s Régie de l’énergie for permission to raise hydro rates by 1.1 per cent, it said on Tuesday.

The utility said it needs the extra money to deal with an increase in the cost of buying electricity from private producers and for planned infrastructure spending.

If the increase is approved, it will be the largest increase in hydro rates since 2015, when rates rose 2.9 per cent. In 2016 and 2017, the Régie de l’énergie approved 0.7-per-cent increases — in all of those years the approved increases were lower than the increases requested by Hydro-Québec.

If the increase is approved, it would go into effect on April 1 and would affect all residential electricity users and most business users. Large industrial users pay a different rate; Hydro-Québec is asking for permission to raise that rate by 0.8 per cent.

Hydro-Québec said the increase will cost apartment dwellers around 47 cents extra per month. People who live in a large house, which the utility defines as 207 square metres, can expect to pay an extra $2.95 a month, it said.

Consumers may get a slight break, though. Hydro-Québec wants to increase the first tier of electricity consumption — for which it charges the lowest rates — from the first 33 kilowatt hours of electricity consumption to the first 36.

On a conference call with reporters, David Murry, the president of Hydro-Québec Distribution, said the increase is below the rate of inflation and hydro rates will remain the lowest in North America. Consumers in Toronto pay more than twice as much as Montrealers for electricity, while New Yorkers pay more than four times as much, he said.

Hydro-Québec plans to begin testing a dynamic pricing model in late 2018, Murry said. That would see rates fluctuate based on the time of day, in an effort to reduce consumption during peak periods.

This will be the third time Hydro-Québec has tested a dynamic pricing model.

The voluntary pilot project will be aimed at residential users, greenhouses and ski hills.

Hydro-Québec said it’s also working to encourage large technology companies to locate data centres, which consume a lot of power, in Quebec.

It’s a “win-win-win” Murry said, with Quebecers, the utility and the companies all benefiting.

Régie de l’énergie will study the request between September and February and is scheduled to give its decision in March.